High Courts Weekly Round-Up
High Courts Weekly Round-Up – Taxscan
High Courts Weekly Round-Up – Taxscan
This weekly round-up analytically summarizes the key stories related to the High Court reported at Taxscan.in during the previous week from November 1 to November 7, 2021.
Godrej & Boyce Mfg. Co. Ltd. Vs. UOI
In a major relief to Godrej & Boyce, the Bombay High Court quashed the Show Cause Notice for allegedly availing inadmissible transitional credit worth Rs.3.83 Crores as it has been issued on an erroneous legal premise. The division bench headed by Chief Justice Dipankar Dutta and Justice G.S.Kulkarni held that where the impugned show-cause notice suffers from an error going to the root of the jurisdiction of the respondent in assuming jurisdiction and is, accordingly, indefensible and liable to be set aside.
Prem Prakash Bansal Vs. State of Maharashtra
The Bombay High Court refused Anticipatory Bail to a person accused of wrongfully Claiming Input Tax Credit (ITC) without giving payment to the supplier.
Sony Sales Corporation Vs. State of Maharashtra
The Bombay High Court ruled that the writ petition is not maintainable as Statutory Alternative Remedy is available for under Maharashtra Value Added Tax Act (MVAT).
M/s S.R. Steel Vs. State of U.P.
The Allahabad High Court quashed the Order canceling GST Registration as no prior show cause notice was issued. The division bench of Justice Naheed Ara Moonis and Justice Saumitra Dayal Singh noted that the show cause notice dated 5.4.2018 as served on the petitioner was unintelligible and a physical copy of the said notice was not served at the relevant time, the order canceling the petitioner’s registration is found to be wholly ex-parte being contrary to the mandatory requirement of the first proviso to Section 29(2) of the Act. As to the delay, the petitioner has explained the same on account of the spread of the pandemic COVID-19.
PCIT Vs. M/s United Spirits Ltd.
The Karnataka High Court allowed the Income Tax deduction on the loss suffered by an assessee on account of Foreign Exchange Fluctuation Loss. The division bench of Justice S. Sujatha and Justice Ravi V.Hosmani held that the loss suffered by an assessee on account of foreign exchange difference as on the date of the balance sheet is an item of expenditure under Section 37(1) of the Act. The view of the Assessing Officer and the CIT (A) that the investments were made on, from the FNCR loans is not based on any supporting material and is only a presumption. Hence, confirming the view of the Tribunal, the court answered in favor of the assessee and against the revenue.
CBDT Vs. Vasudev Adigas Fast Food
The Karnataka High Court held that the Central Board of Direct Taxes (CBDT) empowered to issue orders to other Income Tax Authorities to Condone Delay in cases of genuine hardship. The division bench of Justice Satish Kumar Sharma and Justice Natarajan Rangaswamy held that the CBDT has ignored the recommendations of the jurisdictional authorities to condone the delay in filing the return of income, at the time of considering the application of the respondent/assessee seeking condonation of delay in filing the return of income. The CBDT had sought a report from the Principal Commissioner of Income Tax-II, as well as the jurisdictional Additional Commissioner of Income Tax. It is pertinent to note that both the Principal Commissioner of Income Tax-II as well as the jurisdictional Additional Commissioner of Income Tax have given a report that the delay in filing the return of income may be condoned. Though the CBDT has referred to the said opinions but has not taken the same into consideration while deciding the application of the respondent/assessee.
In a major relief to Himalaya Drug, the Karnataka High Court quashed the notice as a search conducted by the Deputy Commissioner of Income Tax was without Jurisdiction. The division bench of Justice S. Sujatha and Justice Ravi V.Hosmani held that the notice issued without jurisdiction is substantive illegality and not a procedural violation of the nature advertised in Sections 292B and 292BB which deals with mistake/defect or service of notice.
In a major relief to the PNB Metlife, the Karnataka High Court held that Surplus with the deficit as per shareholders’ account should be aggregated with policyholders’ account for determining profit or loss.
M/s Southern Hills Developers Pvt. Ltd. Vs. DCIT
The Karnataka High Court while remanding the matter back to the Income Tax Appellate Tribunal (ITAT) held that the assessee entitled to claim finance charges after completion of the Project goes contrary to findings of Income Tax Authorities.
Abu Dhabi Investment Authority Vs. AAR
In a major relief for Abu Dhabi Investment Authority (ADIA), the Bombay High Court while quashing the Authority of Advance Ruling (AAR)has ruled that any investment made directly or through other trusts by any Dubai or Abu Dhabi business is not taxable under India-UAE Double Tax Avoidance Agreement (DTAA).
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